Global Tax and Legal November Grants & Incentives program updates The latest legislative developments from around the world

Transcription

1 Global Tax and Legal November 2014 Grants & Incentives program updates The latest legislative developments from around the world

2 Countries included This update provides a summary of the latest developments affecting Grants & Incentives and Research & Development programs. For more information, please contact the local partner of the respective program directly. EU Australia Germany Italy Slovak Republic South Africa United Kingdom For more information

3 EU Horizon 2020 SME Instrument The SME Instrument helps high-potential SMEs to develop ground-breaking innovative ideas for products, services or processes. It supports close-to-market activities in three different stages covering the whole innovation cycle: (1) Feasibility. 50,000 per project (70% of total cost of the project); (2) Innovation project. Indicative range of 0.5 to 2.5 million (70% of total cost of the project); (3) Free-of-charge commercialization support (access to debt and equity financial instruments and various other measures). 3 billion Cash grant Deadline Continuously open (next cut-off deadline: 17 December 2014) Steve Conibear, Senior Manager stconibear@deloitte.co.uk Tel no

4 EU Eurostars Funding is available to support research-performing SMEs (those that dedicate at least 10% of their turnover or FTE to research activities), by initiating innovative pan-european projects and co-funding their research activities, enabling them to compete internationally and become leaders in their sector. It specifically targets the development of new products, processes and services. Eurostars is bottom-up meaning that project applications are accepted from any technological or market area billion Cash grant Deadline 05 March 2015 Steve Conibear, Senior Manager Tel no

5 EU Horizon 2020 Support for ICT Key Enabling Technologies Funding for collaborative R&D and Innovation projects for key enabling technologies in the following areas: Advanced Computing Future Internet Content technologies and information management Robotics Micro- and nano-electronic technologies, Photonics Support is also available for cross-cutting activities such as the Internet of Things. In most cases, at least three independent legal entities from different Member States or Associated Countries are required to apply. 561 million (2015 call) Cash grant (funding %) Deadline 14 April 2015 Kees Tuinenbreijer, Senior Manager Tel no

6 Australia Funding for industry growth centers Industry Innovation and Competitiveness Agenda released in October 2014, the Government announced $188.5 million to fund five sectors: Food and agribusiness Mining equipment, technology and services Oil, gas and energy resources Medical technologies and pharmaceuticals, and Advanced manufacturing sectors. Project funding will focus on market, value chain or technology issues to deliver commercial outcomes with sector-wide impact with a proposed staged roll-out of the centers from early A$188.5 million Funding for specific non-profit industry growth centers Deadline Expressions of interest from business-led consortia invited in late 2014 Serg Duchini, Partner sduchini@deloitte.com.au Tel no

7 Australia The National Stronger Regions Fund (NSRF) Five year, $1 billion Federal Government competitive assistance program to support investment in priority economic and infrastructure areas. Offers potential support to projects on a $1 for $1 invested basis (individual grants range from $20,000 to $10 million). The merit criteria on which applications are assessed relate to the extent to which the project: Contributes to economic growth in the region Supports or addresses disadvantage in a region Increases investment and builds partnerships in the region An applicant is viable and sustainable. NSRF funding will be provided for capital projects which involve the construction of new infrastructure, or the upgrade, extension or enhancement of existing infrastructure. Applications will only be accepted from local government bodies and not-for-profit organizations. A$1 billion Deadline Government grant competitive The closing date for this round is 28 November 2014, with the next round closing 31 July 2015 Serg Duchini, Partner sduchini@deloitte.com.au Tel no

8 Australia The Next Generation Manufacturing Investment Program (NGMIP) $60 million Federal Government competitive assistance program to support capital investment projects in areas of high value manufacturing. Offers potential support to projects on a $1 for $1 invested basis (individual grants range from $500,000 to $5 million). The project must take place at a manufacturing site based in South Australia or Victoria and high value activities can include activities that: Focus on niche manufacturing Need a highly skilled workforce Compete on quality, uniqueness, reliability and prestige Use innovation Use new composites & high performance materials eg bio-based sources Use new technology in production processes such as computer-aided design and manufacturing The following five merit criteria need to be addressed: The level of net economic activity to be generated by your project (25 points) The extent to which your project represents a new or expanded activity for your business (25 points) The value for money offered by your project (20 points) The demonstrated capacity and capability of your business to access and capture market opportunities (20 points) The expected productivity improvement and sustainability for your business generated by your project (10 Points) A$60 million Deadline Government grant competitive The closing date for applications is 9 January 2015, and no further rounds have been announced at this stage Serg Duchini, Partner sduchini@deloitte.com.au Tel no

9 Germany Biotechnology/Pharmacology/Diagnosis SME innovative: Transnational projects on Biotechnology (Please note that only SMEs can apply for this program) Application-oriented R&D projects in the field biotechnology will be funded. The projects should broaden the technology base of the participating companies build strategic alliances between SMEs Thematic focus on pharmaceutical developments of new active ingredients Only projects with SMEs from two different countries are eligible The overall budget for this call is at least 16 million For companies grants of up to 50% of eligible costs can be awarded For universities and research institutions grants of up to 100% of eligible costs can be awarded Non-repayable cash grant to a consortium Deadline Submission of project outline (first stage): 30 January 2015 Isabel Antholz, Manager or Teresa Stahl, Professional iantholz@deloitte.de or tstahl@deloitte.de Tel no. +49 (0) or +49 (0)

10 Germany Nanotechnology/Nano-Sciences Secure application of innovative nano-sciences and nanotechnologies R&D activities focusing on environmental risks, health risks and security risks in relation with synthetic nanomaterial: General aspects of research on risks related to synthetic nanomaterial Understanding of toxicity Research of nanomaterial and its effects on human health Funding of European and European-American transnational projects No overall budget published For companies, grants of up to 50% of eligible costs can be awarded For universities and research institutions, grants of up to 100% of eligible costs can be awarded Non-repayable cash grant to a consortium of European and European-American consortia (including at least one partner from Germany) Deadline Submission of project outline in English (first stage): 16 January 2015 Oliver Hasse, Senior Manager or Teresa Stahl, Professional ohasse@deloitte.de or tstahl@deloitte.de Tel no. +49 (0) or +49 (0)

11 Germany ICT/Manufacturing Smart Service World Internet based services for the industry This R&D scheme is aimed at projects which develop innovative ICT-based services for industrial application. The focus is on: increasing the flexibility of open service platforms developing and implementing concepts of resilience increasing the intelligence and ability to learn for smart services developing new concepts of connectivity for cyber physical systems No overall budget published For companies, grants of up to 50% of eligible costs can be awarded For universities and research institutions, grants of up to 100% of eligible costs can be awarded Non-repayable cash grant to a consortium Deadline Submission of project outline (first stage): 30 April 2015 Oliver Hasse, Senior Manager or Teresa Stahl, Professional ohasse@deloitte.de or tstahl@deloitte.de Tel no. +49 (0) or +49 (0)

12 Italy all sectors New incremental R&D tax credit The Italian Government is currently remodelling the rules referring to the new incremental R&D tax credit (previously described in the February 2014 Global Newsletter) draft Financial Law foresees a tax credit available for Fiscal Years 2015 through 2019 equal to 25% of the annual R&D incremental expenditures exceeding the average value of R&D expenditures incurred during FYs 2012, 2013 and The percentage should be increased to 50% for the cost of highly-qualified researchers and for R&D activities contracted to universities, research entities or to other companies. The cap should be increased from 2.5 million up to 5 million per-year and a previous 500 million turnover condition should be removed. This incentive can be used to offset Corporate Income Tax, Regional Tax, VAT and withholding tax liabilities. 2.3 billion Tax credit Deadline 30 September 2016 Ranieri Villa, Partner ravilla@sts.deloitte.it Tel no

13 Italy all sectors Patent box regime 2015 draft Financial Law foresees a 50% tax exemption of incomes earned from patents from FY As for FYs 2015 and 2016 the deduction will be limited to 30% and 40% respectively. This relief is also applicable to incomes earned from intangibles directly owned and exploited by a company, provided the amount is determined through an international standard ruling procedure. The same provision applies in cases where income from patents is generated among companies belonging to the same group (intercompany relationship). In addition, in order to benefit from the 50% tax exemption on incomes, IP rights need to be retained in Italy and patents must be developed by an Italian entity (according to the Nexus Approach). Approximately 150 million for FY 2015 Patent box regime (tax exemption) Deadline 30 September 2016 Ranieri Villa, Partner ravilla@sts.deloitte.it Tel no

14 Slovak Republic Call for the submission of projects focused on the efficient use of energy in the industry and related services As part of the call, support will be provided to projects primarily designed to reduce the consumption of energy. Beneficiaries will include micro, small and medium-sized companies. The maximum intensity of the support is 70%, depending on the type of project and applicant. Support will be granted to renovating and modernizing construction buildings, industrial premises, energy distribution systems and external lighting systems for the purpose of reducing their energy requirements. The call is not designed to support the purchase of more energy-efficient production technologies. The total allocation is EUR 3,000,000 Cash grant Deadline 13 January 2015 Martin Rybár, Director Tel no

15 South Africa Section 11D Research and Development Deduction A bill to amend the R&D legislation was submitted to parliament on 22 October The most significant of the proposed amendments is the inclusion of the development of generic drugs and the conducting of clinical trials in the definition of qualifying R&D. These amendments will be applied retrospectively from 1 October This is positive news for the pharmaceutical industry as there is now a legislative basis to approve their R&D activities. The R&D tax incentive is a super deduction of 150% of qualifying R&D expenditure which results in a cash benefit of 14 cents for every rand at a 28% tax rate. Unlimited Research and Development Tax Allowance Deadline None Newton Cockcroft, Director ncockcroft@deloitte.co.za Tel no. +27 (0)

16 South Africa Business Process Services (BPS) Incentive Program The objective of the program is to create employment in South Africa through servicing offshore activities for e.g. call centers, back office processes, financial shared services centers etc. The Department of Trade and Industry published revised BPS guidelines on 15 October The significant changes are: Applicants must achieve at least a level four Broad Based Black Economic Empowerment Status BB-BEE contributor status in terms of the BB-BEE Codes of Good Practice ( or must submit a plan to demonstrate how they will achieve a level four status within 24 months The project must employ at least 80% youth (ages 18 35) There is now a distinction between non-complex and complex jobs and their respective incentive benefits. A complex job refers to a fully loaded operating cost > ZAR per annum per job and wages contributing 65% of the operating cost base for a steady state of operation. A non-complex job refers to a fully loaded operating cost ZAR per annum per job and wages contributing 65% of the operating cost base for a steady state of operation. The Base Incentive is payable over a period of five years from the date which the offshore job is created Up to R per non-complex job Up to R per complex job The Graduated Bonus Incentive is only payable at the end of the five year period Over 400 non-complex jobs created Over 200 incentive jobs created Cash Incentive Deadline The incentive is effective from 1 October 2014 to 31 March 2019 Newton Cockcroft, Director ncockcroft@deloitte.co.za Tel no. +27 (0)

17 South Africa Section 121 additional investment and training allowances in respect of industrial policy projects The amendment bill submitted to parliament on 22 October 2014 has proposed the following amendment to the Section12I Incentive: The minimum cost of qualifying manufacturing assets threshold has decreased from ZAR200 million to ZAR50 million. The objective of this reduction is to encourage smaller industrial projects to apply and qualify for this allowance. The change will be effective from 1 January Unlimited Tax allowance Industrial Policy Project with Preferred Status Project Project Status Incentive Limitation Greenfield Preferred 55% of the cost of manufacturing assets ZAR900 million Industrial Policy 35% of the cost of manufacturing asset ZAR550 million Brownfield Preferred 55% of the cost of manufacturing assets ZAR550 million Industrial Policy 35% of the cost of manufacturing asset ZAR350 million Deadline 31 December 2015 Newton Cockcroft, Director ncockcroft@deloitte.co.za Tel no. +27 (0)

18 United Kingdom collaborative research and development Energy Catalyst - Late-stage awards - Pre-commercial technology validation The Energy Catalyst will support businesses and researchers from any sector, who can deliver innovative solutions that contribute to all elements of the energy trilemma: reducing emissions, improving security of supply and reducing cost, acknowledging that some solutions may be biased more to one or two of these elements. Proposals should bring new and innovative solutions and applications into the energy sector and its supply chain. In addition, the following are encouraged: the adoption and integration of cross-cutting, enabling technologies which are applicable across a range of sectors, for example, high-value manufacturing, advanced materials, sensors and information and communication technologies (ICT). Indicative examples of technology areas that are within the scope of the Catalyst include, but are not limited to: carbon abatement; renewable energy; nuclear fission; hydrogen and fuel cells (excluding transport propulsion applications); energy networks and system integration; demand-side technologies; and enabling technologies and processes. Proposals must be collaborative and business-led. Funding will be expected to cover mainly Experimental Development projects in which a business partner will generally attract up to 25% public funding for their project costs (35% for SMEs). Industrial Research projects are funded under Mid-stage awards details available on request. Projects are expected to take up to 36 months and the total project costs can be up to 10 million. A briefing webinar will be held on 10 November million Cash grant Deadline Competition deadline 18 February 2015; Registration deadline 11 February 2015 Alistair Davies aldavies@deloitte.co.uk Tel no

19 United Kingdom collaborative research and development Improving food supply chain efficiency Innovate UK, together with the Department for Environment, Food and Rural Affairs (Defra) and the Biotechnology and Biological Sciences Research Council (BBSRC) are to invest up to 11m in business projects which will significantly improve the resource efficiency and resilience of the food and drink supply chain (beyond primary production). Specifically, proposals should address one or more of the following high-level challenges: a reduction in the production of waste in the food and drink supply chain; more efficient use of resources such as energy, water and raw materials; improvement in the productivity of food and drink manufacturing and (re)processing operations; improvement in the resilience of the food and drink supply chain by making better use of resources, reducing environmental stresses on food systems and assuring food quality. It is expected that there will be a range of approaches to these challenges. Proposals must be collaborative and business-led. Funding will be expected to cover mainly Industrial Research projects in which a business partner will generally attract up to 50% public funding for their project costs (60% for SMEs). Projects are expected to take up to 36 months and the total project costs should range from 250,000 to 1 million. 11 million Deadline Cash grant Two stage application process: Registration deadline 26 November 2014; Expression of Interest deadline 3 December 2014; Stage 2 deadline 12 February 2014 (invited applicants only) Alistair Davies aldavies@deloitte.co.uk Tel no

20 For more information For more information on any of the programs listed above, please contact the in-country representative or your usual contact. For further information on how Deloitte can assist with available grants and incentives please contact: Natan Aronshtam Global Managing Director R&D and GI, DTTL Alistair Davies Director, Deloitte UK Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee ( DTTL ), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as Deloitte Global ) does not provide services to clients. Please see for a more detailed description of DTTL and its member firms. Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries and territories, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte s more than 200,000 professionals are committed to becoming the standard of excellence. This communication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively, the Deloitte network ) is, by means of this communication, rendering professional advice or services. No entity in the Deloitte network shall be responsible for any loss whatsoever sustained by any person who relies on this communication For information, contact Deloitte Touche Tohmatsu Limited.